Mitsubishi Motors will supply 36,000 minicars a year to Nissan Motor, starting in the first half of fiscal 2005, which begins on April 1.

The Associated Press (AP) noted that both Nissan and Mitsubishi had said they were talking about a possible tie-up, and the agreement was not a major surprise. Nissan, which does not make its own minicars, now gets minicars from Suzuki, the report added.

AP said that Mitsubishi Motors has previously supplied Nissan with 20,000 commercial minicars, and the latest deal covers passenger minicars.

Nissan will be able to increase its minicar lineup while Mitsubishi Motors will be able to produce minicars more efficiently by increasing production volume, both sides said in a statement cited by the Associated Press.